SREESADAN AYURVEDA AUSHADHA SALA,KANNUR vs. ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-2, KOZHIKODE, KOZHIKODE

ITA 612/COCH/2025Status: DisposedITAT Cochin29 October 2025AY 2018-19Bench: SHRI INTURI RAMA RAO (Accountant Member)1 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal found no basis for the CIT(A) to estimate the profit at 17% and held that such estimation should be based on past history and not be arbitrary. The matter was remitted back to the AO to adopt the average GP rate of the preceding three years.

What were the facts?

The assessee, engaged in the business of Ayurvedic products, filed a return for AY 2018-19. The AO completed the assessment by estimating the gross profit at 30% of the turnover, rejecting the books of account. The CIT(A) directed the AO to estimate the profit at 17% of the turnover.

What were the issues?

Whether the CIT(A) was justified in estimating the profit at 17% of the turnover without proper basis.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 44AD

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, COCHIN BENCH

Before: SHRI INTURI RAMA RAO, AM

For Respondent: Smt. Leena Lal, Sr. D.R
Hearing: 27.10.2025Pronounced: 29.10.2025

These appeals filed by the assessees are directed against the order of the Commissioner of Income Tax (Appeals)-3, Kochi [CIT(A)] dated 30.06.2025 for Assessment Year (AY) 2018-19. 2. Since identical issues and facts are involved in these appeals, they are heard together and disposed of by this common order. For bearing ITA No. 610/Coch/2025 for AY 2018-19 are stated herein.

3.

The appellant is an individual engaged in the business of dealing with Ayurvedic products. The return of income for AY 2018-19 was filed on 2

The order continues below.

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